April 2025 - Working Paper33688 Why is in-kind aid a prominent feature of welfare systems? We present a lab-in-the-field experiment involving members of the general U.S. population and SNAP recipients. After documenting a widespread desire to limit recipients choices, we quantify the relative importance of (i) welfarist motives,...
March 2024 - Working Paper32208 Validation of happiness measures is inherently challenging because subjective sensations are unobserved. We introduce a novel validation method: subjects report how happy they would feel (or did feel) after some specified event, as well as how they would respond (or would have responded) to a survey...
March 2024 - Working Paper32200 The standard revealed-preference approach to welfare economics encounters fundamental difficulties when the act of choosing directly affects welfare through emotions such as guilt, pride, and anxiety. We address this problem through an approach that redefines consumption bundles in terms of the...
January 2022 - Working Paper29616 This paper develops a method to infer causal effects of treatments on choices, by exploiting relationships between choices and hypothetical evaluations. Under specified conditions, it can recover treatment effects even if the treatment does not vary across observations in the sample. Additional...
October 2021 - Working Paper29389 Collective decision making requires preference aggregation even if no ideal aggregation method exists (Arrow, 1950). We investigate how individuals think groups should aggregate members' ordinal preferencesthat is, how they interpret "the will of the people." Our experiment elicits revealed...
December 2020 - Working Paper28254 Previous studies of optimal default options demonstrate that either opt-out minimization or maximization is optimal under restrictive conditions. We obtain a general characterization of the solution by studying optimal defaults when one of the problem's parameters approaches a limiting value. We...
July 2019 - Working Paper26119 We study experimentally when, why, and how people intervene in others' choices. Choice Architects (CAs) construct opportunity sets containing bundles of time-indexed payments for Choosers. CAs frequently prevent impatient choices despite opportunities to provide advice, believing Choosers benefit....
November 2018 - Working Paper25257 In settings with uncertainty, tension exists between ex ante and ex post notions of fairness (e.g., equal opportunity versus equal outcomes). In a laboratory experiment, the most common behavioral pattern is for subjects to select the ex ante fair alternative ex ante, and switch to the ex post fair...
September 2018 - Working Paper25034 We investigate the impact of peer interaction on the quality of financial decision making in a laboratory experiment. Face-to-face communication with a randomly assigned peer significantly improves the quality of subsequent private decisions even though simple mimicry would have the opposite effect....
July 2018 - Working Paper24828 This chapter surveys work in behavioral public economics, emphasizing the normative implications of non-standard decision making for the design of welfare-improving and/or optimal policies. We highlight combinations of theoretical and empirical approaches that together can produce robust qualitative...
October 2014 - Working Paper20618 We examine methods for evaluating opportunity-neutral interventions designed to improve the quality of decision making in settings where people imperfectly comprehend consequences. In an experiment involving financial education, conventional outcome metrics (financial literacy and directional...
March 2014 - Working Paper20011 This paper examines the relationship between the concentration of political power in legislative bargaining and the predictability of the process governing the recognition of legislators. Our main result establishes that, for a broad class of legislative bargaining games, if the recognition...
March 2014 - Working Paper19993 Though economists have made substantial progress toward formulating theories of collusion in industrial cartels that account for a variety of fact patterns, important puzzles remain. Standard models of repeated interaction formalize the observation that cartels keep participants in line through the...
August 2013 - Working Paper19269 A central task in microeconomics is to predict choices in as-yet-unobserved situations (e.g., after some policy intervention). Standard approaches can prove problematic when sufficiently similar changes have not been observed or do not have observable exogenous causes. We explore an alternative...
August 2013 - Working Paper19270 We investigate the feasibility of inferring the choices people would make (if given the opportunity) based on their neural responses to the pertinent prospects when they are not engaged in actual decision making. The ability to make such inferences is of potential value when choice data are...
January 2013 - Working Paper18742 The absence of self-control is often viewed as an important correlate of persistent poverty. Using a standard intertemporal allocation problem with credit constraints faced by an individual with quasi- hyperbolic preferences, we argue that poverty damages the ability to exercise self-control. Our...
January 2012 - Working Paper17762 This paper provides evidence concerning the extent to which consumers of liquor employ commitment devices. One widely recommended commitment strategy is to regulate alcohol consumption by deliberately manipulating availability. The paper assesses the prevalence of the availability strategy by...
November 2011 - Working Paper17587 Default contribution rates for 401(k) pension plans powerfully influence workers choices. Potential causes include opt-out costs, procrastination, inattention, and psychological anchoring. We examine the welfare implications of defaults under each of these theories. We show how the optimal default,...
November 2010 - Working Paper16530 We study the characteristics of self-selected candidates in corrupt political systems. Potential candidates differ along two dimensions of unobservable character: public spirit (altruism toward others) and honesty (the disutility suffered when selling out to special interests after securing office)....
December 2008 - Working Paper14622 This paper discusses several competing proposals for general normative frameworks that would encompass non-standard models of choice. Most existing proposals equate welfare with well-being. Some assume that well-being flows from the achievement of well-defined objectives, and that those objectives...
April 2008 - Working Paper13954 This paper evaluates the prospects for the emerging field of neuroeconomics to shed light on traditional positive and normative economic questions. It argues that the potential for meaningful contributions, though often misunderstood and frequently overstated, is nevertheless present....
February 2008 - Working Paper13796 This paper measures the effects of real estate brokerage services provided to sellers, other than MLS listings, on the terms and timing of home sales. It is not obvious that sellers benefit from those services. On the one hand, brokers offer potentially useful knowledge and expertise. On the other...
January 2008 - Working Paper13737 We propose a broad generalization of standard choice-theoretic welfare economics that encompasses a wide variety of non-standard behavioral models. Our approach exploits the coherent aspects of choice which those positive models typically attempt to capture. It replaces the standard revealed...
August 2005 - Working Paper11518 This paper has two goals. First, we discuss several emerging approaches to applied welfare analysis under non-standard ("behavioral") assumptions concerning consumer choice. This provides a foundation for Behavioral Public Economics. Second, we illustrate applications of these approaches by...
November 2002 - Working Paper9329 We propose an economic theory of addiction based on the premise that cognitive mechanisms such as attention affect behavior independently of preferences. We argue that the theory is consistent with foundational evidence (e.g. from neurosciencee and psychology) concerning the nature of decision...
May 2002 - Working Paper8973 We examine democratic policy-making in a simple institution with real-time agenda setting. Individuals are recognized sequentially. Once recognized, an individual makes a proposal, which is immediately put to a vote. If a proposal passes, it supercedes all previously passed proposals. The policy...
October 2001 - Working Paper8544 Using the 1995 Survey of Consumer Finances and an elaborate life-cycle model, we quantify the potential financial impact of each individual's death on his or her survivors, and we measure the degree to which life insurance moderates these consequences. Life insurance is essentially uncorrelated with...
June 2001 - Working Paper8333 Proposals to alter the estate tax are contentious and have been debated largely in an empirical vacuum. This paper examines time series and cross-sectional variation to identify the effects of gift and estate taxation on the timing of private transfers. The analysis is based on data from the 1989,...
July 2000 - Working Paper7791 In the United States, more than two-thirds of decedents with multichild families divide their estates exactly equally among their children. In contrast, intra vivos gifts are usually unequal. These findings challenge the validity of existing theories regarding the determination of intergenerational...
March 1, 2000 - Article
Almost one third of wives and 10 percent of husbands would have suffered a decline in living standards of more than 20 percent had their spouse died in 1992. And 15 percent of wives would have suffered a decline in living standards of 40 percent or more. A significant proportion of U.S. households...
October 1999 - Working Paper7372 This study examines the adequacy of life insurance among married American couples approaching retirement. It improves upon previous work in two ways. First, it is based on recent, high quality data (the 1992 Health and Retirement Survey with matched Social Security earnings histories). Second, it...
March 1999 - Working Paper7061 In this survey, I summarize and evaluate the extant literature concerning taxation and personal saving. I describe the theoretical models that economists have used to depict saving decisions, and I explore the positive and normative implications of these models. The central positive question is...
December 1, 1997 - Article
The study also finds that taking high school finance courses tends to boost the net worth (or wealth) of those individuals as adults. Teach a youth to save, and he or she will save more as an adult. That's the key finding of an NBER study on the impact of courses that teach high school students...
October 1997 - Working Paper6227 Household survey data consistently depict large variations in saving and wealth among households with similar socio-economic characteristics. Within the context of the life" cycle hypothesis, families with identical lifetime resources might choose to accumulate" different levels of wealth for a...
July 1997 - Working Paper6085 Over the last forty years, the majority of states have adopted consumer education policies, and a sizable minority have specifically mandated that high school students receive instruction on topics related to household financial decision-making (budgeting so forth). In this paper, we attempt to...
July 1996 - Working Paper5655 We examine the effects of education on financial decision-making skills by identifying an interesting source of variation in pertinent training. During the 1990s, an increasing number of individuals were exposed to programs of financial education provided by their employers. If, as some have argued,...
July 1996 - Working Paper5666 In this paper, we provide a conceptual framework for understanding the phenomenon of exclusive dealing, and we explore the motivations for and effects of its use. For a broad class of models, we characterize the outcome of a contracting game in which manufacturers may employ exclusive dealing...
July 1996 - Working Paper5667 In recent years, the United States has witnessed significant growth in programs of financial and retirement education in the workplace. This phenomenon provides an opportunity to assess the effects of targeted education programs on financial choices. This paper uses a novel household survey to...
July 1996 - Working Paper5682 We explore signaling behavior in settings with a discriminating signal and several costly nondiscriminating ( money burning ) activities. In settings where informed parties have many options for burning money, existing theory provides no basis for selecting one nondiscriminating activity over...
January 1, 1993 - Chapter
The evidence presented in this paper supports the view that many Americans, particularly those without a college education, save too little. Our analysis also indicates that it should be possible to increase total personal saving among lower income households by encouraging the formation and...
December 1992 - Working Paper4244 We propose and implement a new test of the dividend signaling hypothesis that is designed to discriminate between dividend signaling and other theories that would account for the apparent existence of a dividend preference. Our test refines the use of data on stock price responses to dividend...
November 1992 - Working Paper4215 The evidence presented in this paper supports the view that many Americans, particularly those without a college education, save too little. Our analysis also indicates that it should be possible to increase total personal saving among lower income households by encouraging the formation and...
September 1992 - Working Paper4163 We examine a model of conspicuous consumption and explore the nature of competition in markets for conspicuous goods. We assume that, in addition to intrinsic utility, individuals seek status, and that perceptions of wealth affect status. Under identifiable conditions, the model generates Veblen...
January 1, 1991 - Chapter
January 1, 1991 - Chapter
January 1, 1991 - Book - Conference Volume
The past decade has witnessed a decline in saving throughout the developed world. The consequences can be serious. For individuals, their own economic security and that of their families is jeopardized. For society, inadequate rates of saving have been blamed for a variety of illsdecreasing the...
September 1990 - Working Paper3434 This paper offers a new explanation of the dividend puzzle, based upon a model in which firms attempt to signal profitability by distrubuting cash to shareholders. I assume that dividends and repurchases are identical, except that dividends are taxed more heavily. Nevertheless, I demonstrate that,...
January 1, 1990 - Chapter
April 1989 - Working Paper2942 This paper presents new empirical evidence in support of the view that a significant fraction of total saving is motivated solely by the desire to leave bequests. Specifically, I find that Social Security annuity benefits significantly raise life insurance holdings and depress private annuity...
January 1, 1989 - Chapter
